Research Program Area: Economic Analysis
Topic Areas: Benefits
The benefits of alternative ozone standards on California field crop yields were measured using a regional economic model of production and sales. The total benefits to the state ranged with the ozone standard from a high of $333 million per year to a low of $50 million per year, and were divided approximately equally between producers and consumers.
Comparison of the results with a national crop loss model showed that California had higher overall benefits and a greater proportion of the benefits going to producers. These effects were explained by a higher proportion of more ozone sensitive crops in California and the market impacts of unilateral ozone reduction by California.
The benefits also varied significantly among crops and regions, and different standards by region were shown to yield gains in economic efficiency. Statistical analysis on crop acreage changes over time shows that farmers respond to changed conditions within five years which justified the use of a static model.
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